Exhibit 10.15
PURCHASE AND SALE AGREEMENT
Between
STELLAR LONE STAR, L.L.C., a Washington Limited Liability Company
("Seller")
and
CAVANAUGHS HOSPITALITY LIMITED PARTNERSHIP,a Delaware limited
partnership
("Purchaser")
For the Purchase of OLYMPUS HOTEL AND CONFERENCE CENTER, 000 Xxxx 000
Xxxxx, Xxxx Xxxx Xxxx, Xxxx and associated Restaurants, and Facilities
("Hotel") and adjacent rental building ("Rental Property")
THIS PURCHASE AND SALE AGREEMENT ("Agreement") is made and entered by
and between Stellar Lone Star, L.L.C., a Washington state limited
liability company ("Seller"), and Cavanaughs Hospitality Limited
Partnership, a Delaware Limited Partnership ("Purchaser") the sole
general partner of which is Cavanaughs Hospitality Corporation
("CHC"), and is effective upon the date the last to sign executes and
delivers this document to the other party ("Effective Date"), but is
dated for reference purposes April 28, 1998.
RECITALS
Seller is the owner of the real property and improvements legally
described in Exhibits A and B, which are attached to and incorporated
in this Agreement by this reference. In the event Exhibits A or B are
incomplete or inaccurate, the parties authorize the Title Company
(defined below) to correct these exhibits. The real property and
improvements described in Exhibit A have been operated under the name
Olympus Hotel and Conference Center and consist of a 393 room hotel
and associated restaurants, bars, rental space and meeting facilities
located at 000 Xxxx 000 Xxxxx, Xxxx Xxxx Xxxx, Xxxx 00000
(collectively "Hotel"). The real property and improvements described
in Exhibit B are rental property ("Rental Property") adjacent to the
Hotel.
Seller desires to sell to Purchaser, and Purchaser desires to acquire
from Seller, the Hotel and Rental Property and all associated assets
described in this Agreement on the terms and conditions hereinafter
set forth.
Now, therefore, in consideration of the foregoing premises and the
respective representations, warranties and agreements and conditions
herein contained, and the deposit of Twenty Thousand Dollars
($20,000) by Purchaser into the Escrow (defined below) (which,
together with the additional deposit described in Section 5 below and
all interest thereon, are collectively referred to as "Xxxxxxx Money"
and shall be applied to the purchase price or refunded as described
below), the parties hereto agree as follows:
ARTICLE I
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DEFINITIONS
For the purposes of this Agreement, the following terms (in addition
to terms given defined meanings elsewhere in this Agreement) shall
have the meanings set forth below in this Article I.
"CAPITAL LEASES" are Equipment Leases which are the equivalent of
installment purchase agreements and which are not represented as
operating expenses on the books and records of the Hotel.
"CLOSING" and "CLOSING DATE") - shall have the meaning defined in
Section 9.1.
"CONSUMABLES" - shall mean all supplies, including but not limited to
food and beverage, whether in use, or held in stock for future use,
used in connection with the operation and maintenance of the Hotel,
subject to such depletion and including such resupplies as shall occur
and be made in the normal course of business, excluding, however, all
items of personal property which are owned by Space Lessees or guests
or which are not usable by Purchaser due to license or name
restrictions.
"CUT-OFF TIME" - shall have the meaning defined in Section 9.2.
"EQUIPMENT LEASES" - shall mean, to the extent transferable, the
leases covering items of the type listed as Service Equipment which
are not owned by Seller but are leased by Seller, and which are
located in or upon the Premises or are used or useable in connection
therewith.
"HOTEL" - shall mean the real property and improvements which have
been operated under the name Olympus Hotel and Conference Center and
consist of a 393 room hotel and associated restaurants, bars, rental
space and meeting facilities located at 000 Xxxx 000 Xxxxx, Xxxx Xxxx
Xxxx, Xxxx 00000 described in Exhibit A which is attached to and
incorporated in this Agreement by this reference.
"HOTEL CONTRACTS" - shall mean all service, maintenance, and other
contracts respecting the maintenance or operation of the Hotel.
"IMPROVEMENTS" - shall mean all buildings and improvements on the
Land.
"INSPECTION DOCUMENTS" and "INSPECTION PERIOD" - shall mean the
documents described in Sections 5.1.4 and 5.3.1 and the longest time
period for Purchaser's review and inspection described in Section 5.3.
"LAND" - shall mean the area described in Exhibits A and B to this
Agreement.
"MISCELLANEOUS ASSETS" - shall mean all contract rights, leases,
concessions, permits, receipts, trademarks, logos, copyrights,
business records, and any items of intangible personal property
relating to the ownership or operation of the Hotel, excluding assets
not located in Salt Lake City and used in the operation of property
other than the Hotel and Rental Property.
"NAMES" - shall mean the name "Olympus" and any other names commonly
used in the operation of the Hotel including without limitation the
names now used with the restaurants, banquet rooms and meeting rooms
in the Improvements, and together in each case with the good will
appurtenant thereto, but excluding the names "WestCoast" or "Best
Western" or "Mullboon's".
"OPERATING EQUIPMENT" - shall mean all china, glassware, linen,
silverware and uniforms, and supplies of every kind and nature of all
operating departments, including, without limitation, cleaning
supplies, guest supplies, printing stationery, bar supplies, fuel,
laundry supplies and brochures and promotional material whether in
use, or held in stock for future use, in connection with the operation
of the Hotel, which are on hand on the date hereof, subject to such
depletion and including such resupplies as shall occur and be made in
the normal course of business.
"PERMITS" - shall mean, to the extent transferable, all licenses,
franchises and permits used in the operation of the Hotel, including
but not limited to liquor licenses, as heretofore operated.
"PERMITTED EXCEPTIONS" - shall have the meaning defined in Section
3.1.
"PROPERTY" - shall mean all of the real, personal and intangible
property referred to in Article II.
"RENTAL PROPERTY" - shall mean the real property and improvements
located thereon described in Exhibit B, which is attached to and
incorporated in this Agreement by this reference.
"SERVICE EQUIPMENT" - shall mean all fixtures, furnishings, fittings,
equipment, machinery, apparatus, vehicles, appliances and articles of
personal property of every kind whatsoever used or usable in
connection with any present or future operation of all or any part of
the Hotel, including without limitation all elevators, escalators,
boilers, furnaces, heating, ventilating and air-conditioning systems
and equipment, office furniture and equipment (including safes, cash
registers and accounting, duplicating and communication equipment) and
specialized hotel equipment (including equipment usable in the
operation of kitchens, laundries, meeting and banquet rooms, clubs,
rental spaces, drycleaning facilities, bars and cocktail lounges),
electrical equipment (including refrigerators, radios, television and
lighting equipment), fire prevention and extinguishing apparatus,
telephone system, pictures and ornaments, which are on hand as of the
date hereof, subject to such depletion and including such replacements
as shall occur or be made in the normal course of business; excluding,
however, a) Consumables, b) all items of personal property which are
owned by Space Lessees or guests, and c) office equipment owned by
WestCoast, the current manager of the Hotel.
"SPACE LEASES" - shall mean all leases, subleases, licenses,
concessions and other occupancy agreements, written or oral, whether
or not of record, for use or occupancy of any portion of the Hotel or
Rental Property; and "Space Lessees" shall mean the tenants or
occupants thereunder. These terms do not include rental of hotel
rooms unless such rental is based on an agreement with a term of more
than 30 days.
ARTICLE II
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PURCHASE AND SALE
Upon the terms, conditions, representations and warranties herein set
forth, Seller hereby agrees to sell the following properties, rights
and interests (sometimes hereinafter referred to collectively as
"Property") to Purchaser, and Purchaser agrees to purchase the
Property from Seller:
2.1 HOTEL AND RENTAL PROPERTY - the Hotel, Rental Property, Land
and the Improvements; provided, however, that in the event
Purchaser elects at its sole discretion, by written notice to
Seller prior to the end of the Inspection Period, to delete the
Rental Property from this transaction, neither party shall have
any further obligation to the other with regard to the Rental
Property.
2.2 ADDITIONAL PROPERTY - all of Seller's right, title and interest
in and to the Names, Hotel Contracts, Space Leases, Permits,
Equipment Leases, Service Equipment, Consumables, Operating
Equipment, and all other Miscellaneous Assets.
ARTICLE III
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TITLE AND EXCEPTIONS TO TITLE
3.1 TITLE Good and marketable title to the Property (and good
record title by statutory warranty deed to so much thereof as
shall constitute real property under the laws of the State of
Utah) shall be sold and conveyed to Purchaser subject to the
following matters ("Permitted Exceptions"):
3.1.1 LIENS, ETC. All liens for real estate taxes, water and
sewer charges, provided they are not delinquent and are
prorated as of Closing.
3.1.2 LAWS, ETC. All present laws, ordinances, codes,
restrictions and regulations of all governmental
authorities relating to building and/or zoning.
3.1.3 SPACE LEASES. All terms and conditions of all Space
Leases delivered to Purchaser by Seller at the
beginning of the Inspection Period.
3.1.4 HOTEL CONTRACTS. All terms and conditions of the Hotel
Contracts approved for assumption by Purchaser during
the Inspection Period.
3.1.5 EASEMENTS. Utility easements of record approved by
Purchaser during the Inspection Period.
3.1.6 APPROVED EQUIPMENT LEASES. The Equipment Leases
described in Section 5.3 if approved by Purchaser
during the Inspection Period.
3.1.7 TITLE COMMITMENT EXCEPTIONS. All defects in title
contained in the Title Commitment described in section
5.3.1 below accepted by Purchaser utilizing the
procedure described in section 3.2 below.
3.2 CURING TITLE EXCEPTIONS. Purchaser shall give Seller written
notice within 10 days following delivery to Purchaser of the
Title Commitment and legible copies of all documents referred
to therein of Purchaser's objection to any title exception;
Seller shall, within 5 days following receipt of any such
objection, notify Purchaser whether Seller shall remove such
exception at or prior to Closing; Purchaser shall, within 5
days of Seller's responsive notice, provide Seller with written
notice of whether Purchaser will accept Seller's position or
terminate the transaction. Failure to provide notice within
the preceding time frames shall be treated as rejection of the
Title Commitment exceptions or rejection of the position stated
in the notice from Purchaser or Seller. The preceding
procedure shall not apply to monetary encumbrances totaling
less than the total Purchase Price, which shall be paid in full
at Closing as described in this Agreement. At the sole
discretion of Purchaser, if the Property shall, at the time of
Closing, be subject to any liens for judgments or transfer,
franchise, license or other similar taxes or any encumbrances
or other title exceptions which would be grounds for Purchaser
to reject title hereunder, Purchaser may, instead of exercising
its other rights under this Agreement, elect to waive such
defect in title and close and, in the case of any monetary
encumbrance, offset the amount of the monetary encumbrance
against any amounts payable to Seller.
ARTICLE IV
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PURCHASE PRICE
4.1 AMOUNT. The purchase price payable by Purchaser to Seller for
the Property is Thirty-one Million, Six Hundred Thousand
Dollars ($31,600,000) (the "Purchase Price"); provided,
however, that the Purchase Price shall be reduced to Thirty-one
Million, Four Hundred Thousand Dollars ($31,400,000) if
Purchaser elects, by written notice to Seller prior to the end
of the Inspection Period, to delete the Rental Property from
this transaction.
4.2 METHOD OF PAYMENT. The Purchase Price, as adjusted pursuant to
the express provisions of this Agreement, shall be paid by
Purchaser as follows:
4.2.1 CAPITAL LEASES. Purchaser shall receive a credit
against the Purchase Price at Closing in the amount of
the unpaid balances of the Capital Leases, unless
required to be paid as described in Section 5.3.2.
4.2.2 CASH AT CLOSING. The balance of the Purchase Price
shall be payable all cash at Closing (against which
shall be credited the Xxxxxxx Money deposited with
Escrow by Purchaser in part consideration for this
Agreement)
4.2.3 ALLOCATION OF PURCHASE PRICE. Purchaser and Seller
agree that the Purchase Price shall be allocated 62% to
building, 34% to land and 4% to furniture, fixtures,
equipment (including vehicles) and permits.
4.3 BULK TRANSFER ACT. Purchaser agrees to waive the Bulk Sales
provisions, if any, of the Uniform Commercial Code for the
State in which the Property is located, in consideration of
Seller's indemnification described in section 13.5 below.
ARTICLE V
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CONTINGENCY PERIODS, REPRESENTATIONS AND WARRANTIES OF SELLER
5.1 REPRESENTATIONS AND WARRANTIES. Subject only to the exceptions
set forth in this Agreement and the contingencies described in
Section 5.3, Seller represents and warrants to Purchaser that
the following statements are true:
5.1.1 ORGANIZATION AND STANDING. To the best of Seller's
knowledge, Seller has all requisite power and authority
to own, lease and/or operate the Property and to carry
on the businesses as now being conducted, is in
compliance in all respects with all laws, regulations
and requirements applicable to the operation of the
Property, and has no knowledge of any threatened
violation of any such laws, regulations and
requirements.
5.1.2 AUTHORITY. This Agreement constitutes a valid and
legally binding obligation of Seller. Neither the
execution and delivery of this Agreement nor the
consummation by Seller of the transactions contemplated
hereby, nor compliance by Seller with any of the
provisions hereof will, as of Closing, conflict with or
result in a breach of or default under any of the
terms, conditions or provisions of any note, bond,
mortgage, indenture, license, agreement, or other
instrument or obligation to which Seller or any entity
controlled by Seller is a party or by which they or any
of their properties or assets may be bound or violate
any order, injunction, decree, statute, rule or
regulation applicable to either of them or any of their
assets or properties.
5.1.3 FINANCIAL STATEMENTS. Subject to the procedure
described in section 5.3.1, immediately upon execution
of this Agreement, Seller will furnish Purchaser with
copies of (or make available at the Hotel if so
indicated on the Due Diligence Request List) the
financial information requested in the Cavanaughs Due
Diligence Request List, which is attached to and
incorporated in this Agreement by this reference as
Exhibit C ("Due Diligence Request List"). To the best
of Seller's knowledge and belief, the financial
information provided by Seller fairly present in all
material respects the consolidated financial condition
and results of operations of Hotel.
5.1.4 TITLE COMMITMENT AND DOCUMENTS. Immediately upon
execution of this Agreement, Seller will furnish
Purchaser with true and correct copies (including all
amendments thereto and modifications thereof) of the
documents described in the Due Diligence Request List
(which information shall be updated throughout the
Inspection Period and immediately prior to Closing in
the format normally produced by Seller) which are
within the possession or control of or accessible
Seller and which are discoverable by the Seller after
diligent search. Seller warrants, to the best of its
knowledge, that the information provided to Purchaser
in response to the Due Diligence Request List is
accurate and complete and that there are, to the best
of Seller's knowledge, no agreements with any entity,
individual person or group which are material to the
operation of the business of the Hotel heretofore
conducted or to the value of the Property. except as
provided to Purchaser pursuant to this paragraph.
Immediately upon execution of this Agreement, Seller
shall furnish Purchaser with commitment for an ALTA
Standard Form Owner's Policy of Title Insurance
insuring title in Purchaser to the Property in the
amount of the Purchase Price, together with legible
copies of all documents referred to therein ("Title
Commitment") issued by Transnation Title Insurance
Company ("Title Company").
5.1.5 AGREEMENTS IN FORCE AND EFFECT. To the best of Seller's
knowledge, all documents identified in Section 5.1.4
are valid and in full force and effect, and to the best
of Seller's knowledge no party has breached any
material condition or provision thereof and is not in
default in any material respect under the terms thereof
except as is disclosed in writing by Seller to
Purchaser at the time of delivery of the documents.
5.1.6 ABSENCE OF ADVERSE FACTORS OR CHANGE. There has not
been, or Seller has not, as the case may be:
(i) any material adverse change in the condition
(financial or otherwise) assets, liabilities,
earnings or business of Seller within the past
12 months;
(ii) acquired knowledge of any event directly
relating to the physical condition of the Hotel
which threatens materially to disrupt, prevent
or impair the conduct of the business of the
Hotel; or
(iii) conducted the business of the Hotel otherwise
than in the ordinary course, except as otherwise
expressly provided in this Agreement.
5.1.7 GOVERNMENT REPORTS AND RETURNS. To the best of its
knowledge, Seller has filed in a timely manner, all
reports and returns relating to any of the Property
required to be filed by any applicable law or
governmental regulation, except such reports and
returns the late filing of which (or the failure to
file which) would not have a material and adverse
effect on the conduct of the business of the Hotel.
5.1.8 SELLER'S OBLIGATIONS PAYMENTS. All payments due and
payable under the Assumed Debt, Hotel Contracts,
Equipment Leases, wages and benefits of employees,
Permits and Space Leases ("Seller's Obligations") have
been paid to date, and Seller covenants that Seller's
Obligations will be paid through the Closing.
5.1.9 NAMES. Seller represents and warrants that, to the
best of Seller's knowledge, there is no litigation,
claim or assertion, pending or threatened, which
challenges the validity of or Seller's title to or
right to use any Names.
5.1.10 ABSENCE OF LITIGATION AND LIENS. All Property to be
transferred to Purchaser hereunder, will be free of all
liens and encumbrances, except the Permitted Liens, on
the Closing Date. There is and shall at Closing be no
pending litigation against the Seller which involves a
claim against the Property. To the best of Seller's
knowledge and belief there are no assessments pending
which would constitute a lien or charge against the
Property on the Closing Date, other than non-delinquent
real property taxes.
5.1.11 HAZARDOUS SUBSTANCES AND CODE REQUIREMENTS. To
Seller's knowledge, and except as specifically
disclosed to Purchaser in writing at the time of
delivery of the documents described in the Due
Diligence Request List (which writing shall in turn
refer to any environmental assessment known to Seller),
the Property has never been used for the production,
storage, deposit, or disposal of toxic, dangerous, or
hazardous substances, pollutants, or contaminants,
including without limitation, petroleum products or
asbestos or PCB's or any substance designated as
hazardous by Federal or State or local law or
regulation ("Hazardous Substances"), and no such
Hazardous Substances have ever been placed or located
upon the Property, which, if found upon the Property,
would subject the owner of, or any person holding a
mortgage of or other security interest in, the Property
,to any damage, penalties, or liabilities under any
applicable Federal, State or local statutes, ordinances
or regulations. Seller warrants, except as disclosed
as described in the preceding sentence, that the
Property does not contain any Hazardous Substances as
of Closing ("Existing Hazardous Substances") placed
upon or released into the Property during the period of
Seller's ownership or control other than in full
compliance with all applicable laws, rules, and
regulations. Seller represents and warrants that as of
the date hereof , except as provided to Purchaser at
the time of delivery of the documents described in the
Due Diligence Request List: (a) it has not received
notification of any kind from any regulatory agency
stating that the Property is or may be targeted for a
federal or state Hazardous Substances cleanup or may be
contaminated with any Hazardous Substances or is
currently in violation of any applicable zoning,
building, safety or accessibility law or regulation and
(b) Seller has no knowledge of any release of any
Existing Hazardous Substances or that the Property is
currently in violation of any applicable zoning,
building, safety or accessibility law or regulation.
Seller shall indemnify and hold Purchaser harmless from
and against any and all loss, damage, claims,
penalties, liabilities, suits, costs, and expense
(including, without limitation, cost of remedial
actions or cleanup), suffered or incurred by Purchaser
arising out of Existing Hazardous Substances released
into the Property during the period of Seller's
ownership or related to the breach of the foregoing
representations and warranties, which amounts
Purchaser shall be entitled to offset from any
payments next falling due under any amounts owing to
Seller.
5.1.12 CONDITION OF PROPERTY. To Seller's knowledge, except
to the extent disclosed by Seller to Purchaser in
writing at the beginning of the Inspection Period, the
Hotel is constructed substantially in accordance with
the plans and permits under which it was authorized and
is free of any material physical or mechanical defects.
Material defects shall mean any defect which impairs
the structural integrity of the Improvements, the air,
soil, or water quality, or the availability of utility
services relating to the Improvements, or the use of
the Improvements; there is legal access to the Land at
all points being used for such access at the time of
this Agreement, and all streets, roads, highways, and
avenues adjoining any part of the Land have been
dedicated to the proper municipal authority, and such
municipal authority has the responsibility to maintain
the same and the same are open for public use; Seller
has all appropriate licenses, permits, easements, and
rights of way necessary to ensure adequate vehicular
and pedestrian ingress and egress, and no additional
easements are required for access to the Improvements
or in connection with the location of any utilities
with respect to the current uses of the Improvements;
there are not presently pending any public improvement
assessment proceedings, condemnation, or zoning actions
against the Land, or any part thereof, nor is Seller
aware of any such proceedings or actions being
threatened; there are no encroachments, boundary
problems, prescriptive or adverse interests affecting
the Land or Improvements; and there are no fixtures,
facilities, utilities, heating, air conditioning,
plumbing, electrical, or other systems, equipment,
structures, or improvements of any kind whatsoever,
including without limitation driveways and parking
areas, which benefit the Property and are shared in
common in any way whatsoever with any other real
property.
5.1.13 EMPLOYEE AGREEMENTS. There are no collective
bargaining agreements, no deferred compensation or
profit-sharing plans or arrangements presently in
force, or any other agreement with employees which
would affect the transfer of Property contemplated by
this Agreement or require Purchaser to continue any
employment or compensation arrangement with any person.
Seller has no commitment to create any of the above-
referenced plans nor will they do so while this
Agreement is in effect. As of the Closing, Seller shall
terminate all employees in the operation of the Hotel.
Purchaser represents to Seller that Purchaser will
offer employment to a minimum of 67% of the number of
employees then normally employed at the Hotel as of the
date of Closing, but is not otherwise required to, hire
some or all such employees in connection with
Purchaser's operation of the Hotel. Seller shall be
responsible for all salaries, taxes, benefits, and
vacation (including accrued but unused vacation) for
all employees up to the Closing date.
5.1.14. NON-FOREIGN STATUS. Seller is not a "foreign person"
(i.e., a nonresident alien individual or foreign
corporation) within the meaning of Section 897(a) of
the Code. At Closing, Seller will furnish Purchaser,
in accordance with Code Section 1445 and the
Regulations thereunder, with an affidavit stating,
under penalty of perjury, that Seller is not a "foreign
person," and stating Seller's taxpayer identification
number.
5.2 LIMITATION ON SELLER'S REPRESENTATIONS AND WARRANTIES.
Purchaser acknowledges that, except as expressly set forth in
this Agreement, neither Seller nor any agent or representative
of Seller has made, and Seller is not liable for or bound in
any manner by, any express or implied warranties, guaranties,
promises, statements, inducements, representations or
information pertaining to the Property or any part thereof the
physical condition, income, expenses or operation thereof, the
uses which can be made of the same or any other matter or thing
with respect thereto, including, without limitation, any
existing or prospective Space Leases. Without limiting the
foregoing, Purchaser acknowledges and agrees that, except as
expressly set forth in this Agreement, Seller is not liable for
or bound by (and Purchaser has not relied upon) any verbal or
written statements, representations, financial statements
pertaining to the operation of the Hotel or any other
information respecting the Property furnished by Seller or any
employee, agent, consultant or other person representing or
purportedly representing Seller; and that the Property is being
purchased "AS IS WHERE IS" with the exception of those
representations and warranties expressly set forth in this
Agreement. Except with regard to environmental or structural
matters, any action by Purchaser against Seller based upon a
violation of Seller's representations and warranties must be
commenced within one year of Closing.
5.3 CONTINGENCIES.
5.3.1 PURCHASER'S INSPECTION AND WAIVER. Purchaser shall have
30 days after the later of the Effective Date or
delivery by Seller to Purchaser of the last of the
documents requested in the Due Diligence Request List
within which to inspect the Property and review all
documents requested in the Due Diligence Request List
("Due Diligence Materials") to determine whether the
Property in its current status is suitable, in the
exercise of the sole business judgment discretion of
Purchaser, for the purposes of Purchaser, which
inspection may, at Purchaser's discretion and cost,
include environmental assessments. Purchaser shall only
use the Due Diligence Materials for the purpose of
evaluating the Property, as opposed to any competitive
use, and shall restrict access to the Due Diligence
Materials to those persons required to evaluate the
Property. This Agreement shall terminate, the Xxxxxxx
Money shall be refunded to Purchaser, and all
responsibilities of the parties to one another shall
terminate unless, within 30 days of the later of
complete execution and delivery of this Agreement or
delivery of all Due Diligence Materials, Purchaser
notifies Seller that Purchaser has determined to its
satisfaction the Property can be used for these
purposes to Purchaser's satisfaction. In the event
Purchaser waives its contingency as described in the
preceding sentence, Purchaser shall immediately
increase the amount of Xxxxxxx Money which it deposits
to a total of $600,000.
Completion of delivery of Due Diligence Materials shall
be conclusively established as starting on the earlier
of the following events. Seller shall deliver (or make
available at the Hotel if so provided in Exhibit C) all
Due Diligence Materials to Purchaser within five
business days of the Effective Date, or such earlier
date as Seller can accomplish, together with a listing
of the materials furnished. Purchaser will notify
Seller within three business days of receipt of the
items described in the preceding sentence of any Due
Diligence Materials which have not been included in the
delivery, and in the absence of such notice the 30 day
period will be presumed to have commenced on the
delivery. Seller will, within three business days of
receipt of the notice described in the preceding
sentence, either deliver the missing materials or
represent and warrant to Purchaser that such materials,
to the best of Seller's knowledge, do not exist or
cannot be obtained by Seller, and the 30 day period
will be presumed to have commenced on the date of this
second delivery/notice by Seller.
Immediately upon execution of this Agreement, Seller
shall provide Purchaser with continuing access to the
Property and complementary guest rooms for Purchaser's
inspection personnel to complete such inspections and
reports as Purchaser may elect, provided they shall be
conducted without disruption of the operation of the
Hotel and at Purchaser's sole expense and Purchaser
shall indemnify Seller against any physical damage to
the Property or claim resulting from negligent or
unlawful actions by Purchaser or Purchaser's agents
arising out of Purchaser's inspection activities. To
facilitate this inspection, Seller shall use its best
efforts to have its onsite staff complete to the best
of their knowledge and ability and deliver to Purchaser
the Facility Inspection Questionnaire which is attached
to and incorporated in this Agreement by this reference
as Exhibit D.
5.3.2 CAPITAL LEASES: Purchaser and Seller agree to use their
best efforts to obtain any required consent for
Purchaser to assume all Capital Leases without change
in terms or charge to Purchaser. In the event such
consent cannot be obtained, Seller shall pay in full
any Capital Lease for which consent is not obtained and
obtain clear title for Purchaser to the equipment at
Closing.
ARTICLE VI
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REPRESENTATIONS AND WARRANTIES OF PURCHASER
Purchaser represents to Seller that the following statements are true:
6.1 ORGANIZATION AND STANDING. Purchaser is duly organized and in
good standing in the state of its formation. Purchaser, at
Closing, will be duly organized, validly existing and in good
standing under the laws of the State in which the Property is
located and will have all requisite power and authority to own,
lease and/or operate the Property after the Closing and to
carry on the businesses thereat as now being conducted.
6.2 AUTHORITY. Purchaser has full power to carry out the
transactions provided for in this Agreement. The execution and
delivery of this Agreement by Purchaser and the consummation by
it of the transactions contemplated herein have been duly and
validly authorized by all necessary Corporate action on its
part, and this Agreement constitutes a valid and legally
binding obligation of Purchaser, enforceable against it in
accordance with its terms, except to the extent that
enforceability may be limited by bankruptcy and similar laws
and by equitable principles generally. Neither the execution
and delivery of this Agreement nor the consummation by
Purchaser of the transactions contemplated hereby, nor
compliance by it with any of the provisions hereof will (i)
conflict with or result in a breach of or default under any of
the terms, conditions or provisions of any note, bond,
mortgage, indenture, license, agreement, or other instrument or
obligation to which it is a party or by which it or any of its
properties or assets may be bound, or (ii) violate any order,
writ, injunction, decree, statute, rule or regulation
applicable to it or any of its assets or properties.
ARTICLE VII
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CONDUCT OF BUSINESS PRIOR TO CLOSING
Seller agrees that, between the date of this Agreement and the Closing
Date, Seller will operate the Premises and the business of the Hotel
in substantially the same manner as conducted prior to the date
hereof. Purchaser correspondingly will use its best efforts to effect
continuity of operations between the date of this Agreement and the
Closing. Without limiting the generality of the foregoing, Seller
agrees that between the date of this Agreement and the Closing Date:
7.1 NOTICE OF CHANGE. Seller will notify Purchaser promptly if
Seller becomes aware of any transaction or occurrence prior to
the Closing which would make any of the representations and
warranties in Section 5 untrue in any material adverse respect
if such representations and warranties had been given as of the
date on which Seller becomes aware of any such transaction or
occurrence.
7.2 SPACE LEASES Seller will not, without the prior written
consent of Purchaser, which consent Purchaser agrees not
unreasonably to withhold or delay, modify or amend any Space
Lease or cancel or renew any existing Space Lease or enter into
any new Space Lease. If Purchaser fails to respond to a
request for the consent referred to in the preceding sentence
within five business(5) days after its receipt of such request,
it shall be deemed to have so consented. Subject to this
Section 7.2, Seller agrees to notify Purchaser of any
modification, amendment or cancellation of any existing Space
Lease and of Seller's entry into any new or renewal Space Lease
whether or not Purchaser's consent is required under the
provisions of this Section 7.2, and Seller agrees to furnish
Purchaser with a copy of any new or renewal Space Leases
entered into after the date of this Agreement.
7.3 HOTEL CONTRACT AND EQUIPMENT LEASES. Seller will not enter
into any new Hotel Contracts or Equipment Leases, or renew or
amend any existing Hotel Contracts or Equipment Leases at an
annual expenditure under any such new or renewal Hotel Contract
or Equipment Lease at a rate exceeding the rate currently
prevailing under the existing Hotel Contract or Equipment Lease
for the corresponding service or product without the written
consent of Purchaser which Purchaser may withhold at its
discretion. Seller agrees to notify Purchaser of any proposed
renewal, modification, amendment or cancellation of any
existing Hotel Contract or Equipment Lease and to furnish
Purchaser with a copy of any proposed, new or renewal Hotel
Contract or Equipment Lease prior to execution.
7.4 ENCUMBRANCES. Seller agrees that no borrowings or
hypothecation which would encumber the Property or any part
thereof after the Closing shall be made without the prior
written consent of Purchaser, which consent may be withheld at
Purchaser's absolute discretion.
7.5 BOOKING BUSINESS. Seller shall continue to accept booking
contracts and reservations for the Hotel's facilities in
accordance with past practices, at not less than standard rates
for the Hotel.
7.6 INSURANCE. Seller shall keep in full force and effect through
the Closing all the existing fire and extended coverage and
other insurance policies.
7.7 GOODWILL AND BUSINESS. Seller shall use its best efforts to
preserve intact the good will of the Hotel and the Names with
its existing clientele and to preserve its business
relationships with all wholesalers, suppliers, or other parties
with whom it has an existing business relationship.
7.8 MAINTENANCE AND REPAIR. Seller shall make, at its sole cost
and expense, whatever repairs and replacements may be necessary
to maintain and keep the Property in its present state of
repair (ordinary wear and tear and casualty excepted).
ARTICLE VIII
------------
ADDITIONAL AGREEMENTS
8.1 TITLE INSURANCE. Title exceptions will be handled as described
above.
8.2 ASSIGNMENTS OF SERVICE EQUIPMENT, PERMITS. Seller shall
execute all applications and instruments required in connection
with the transfer to Purchaser of all Service Equipment and all
transferable Permits in order to effect such transfer on the
Closing under this Agreement. All costs and expenses incurred
in connection with said transfers shall be paid by Purchaser.
Seller will use its best efforts to keep all existing Permits
in force, and to renew any of the same which expire prior to
the Closing. In the event that any Permit is suspended or
revoked, Seller shall promptly notify Purchaser of that fact,
and Seller, at its sole cost and expense, shall use its best
efforts to have the Permit reinstated without limitation or
conditions.
8.3 APPLICATIONS FOR PERMITS. Purchaser will use its best efforts
to have issued to it, on the Closing Date, all non-assignable
Permits required for the operation of the Hotel, and Seller
agrees to cooperate with Purchaser in such efforts in any way
reasonably requested, at Purchaser's cost and expense.
8.4 RECORDS. Title to and possession of all records, documents and
papers of every kind and nature pertaining to the Property and
the operation of the Hotel relating to the period of time prior
to the Closing shall be transferred to Purchaser . Purchaser
shall either deliver copies to Seller or make access available
to Seller to the records which Seller may reasonably require
for use in connection with tax records or other reports
following Closing, and shall provide Seller with space in the
Hotel for that purpose.
8.5 COOPERATION. Seller and Purchaser will cooperate with each
other in every way and will exercise their best efforts in
carrying out the transactions contemplated herein, in obtaining
all required approvals, authorizations, and clearances, and in
delivering all documents, instruments, or copies thereof or
other information deemed necessary or useful by the other
party.
8.6 ITEMS NOT INCLUDED IN PURCHASE AND SALE. It is expressly
understood between the parties hereto that the following items
are not included in the "Property" under Article II hereof,
and, accordingly, are not included in this sale and purchase,
except to the extent specifically indicated below:
8.6.1 BANK ACCOUNTS. All cash on deposit in banks or in
transit for deposit for the account of Seller.
8.6.2 OTHER EXCLUDED INTANGIBLES. All (i) prepaid insurance
premiums and other prepaid items, (ii) deposits with
utilities, insurance deposits and other similar
deposits (except that any deposit for rooms or use of
facilities or contracts for use of facilities or made
under terms of any Space Leases shall be transferred to
Purchaser subject to the rights of the depositor).
8.7 ACCOUNTS RECEIVABLE AND PAYABLE. It is the intention of the
parties that the operating revenues of the Hotel shall be
prorated as of the Cut-off Time. Accordingly, all Hotel
accounts receivable, including without limitation, all credit
and charge card receivables, ("Receivables") occurring prior to
the Cut-off Time shall be the property of Seller. All
Receivables occurring subsequent to the Cut-off Time shall be
the property of Purchaser. Except for obligations expressly
approved by Purchaser to be assumed by Purchaser during the
Inspection Period and except for the prorations at Closing
described in this Agreement, all accounts payable arising prior
to Closing are the sole responsibility of Seller. Purchaser
assumes no liability for collection of Receivables of Seller
except, for a period of 90 days following Closing to: (a)
xxxx for such Seller's Receivables, (b) provided there is no
dispute as to the payment of Seller's Receivable, apply any
payment received from the obligor of a Seller's Receivable
first to Seller's Receivable, and (c.) report accurately and
remit to Seller any payment of a Seller's Receivable which
comes to Purchaser.
8.8 COLLECTIONS OF ACCRUED RENT UNDER SPACE LEASES. If at the
Closing there are any past due rents owing to Seller under any
Space Leases, said amounts shall be considered a Receivable of
Seller.
8.9 CONSUMABLES. All Consumables which are useable by Purchaser
(excluding any Consumables prohibited for use by reason of the
termination of any franchise/license agreement) as of the Cut-
off Time shall be inventoried at the Cut-off Time by Purchaser
and Seller. The amount of Consumables located in or issued to
the operating departments in the Hotel will be substantially at
the same levels as have heretofore been maintained in
connection with the operation of the Hotel, which shall be
presumed to be a 30 day supply for all Consumables except food
and beverage.
8.10 POST CLOSING ASSISTANCE AND ARRANGEMENTS.
8.10.1 SELLER'S ASSISTANCE AFTER CLOSING. For a period of
sixty (60) days following the Closing, Seller shall at
reasonable times and upon reasonable notice provide
Purchaser's representatives with such information and
assistance as shall be reasonably required in order for
them to familiarize themselves with the Hotel
operations.
8.10.2 DELIVERY OF DOCUMENTS AFTER CLOSING; INSTRUMENTS OF
FURTHER ASSURANCE. Following the Closing, Seller
agrees, on request of Purchaser, to execute and deliver
to Purchaser such further instruments in writing as may
be reasonably required to complete or evidence the
transaction provided for and Purchaser shall, on
request, execute and deliver like instruments to
Seller.
ARTICLE IX
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CLOSING
9.1 CLOSING. The Closing for the consummation of the transactions
contemplated by this Agreement ("Closing"), including the sale
and purchase of the Property, shall, unless another date and/or
place is agreed to in writing by the parties hereto, take place
at the Title Company ("Escrow"), on the date ("Closing Date")
which is on or before 15 days from the waiver of all
contingencies described in Section 5.3. All proceedings to
take place at the Closing shall take place simultaneously, and
no delivery shall be considered to have been made until all
such proceedings have been completed. Upon completion of the
Closing, Purchaser shall immediately be entitled to actual and
be charged with constructive possession of the Property, and
all risk of loss with regard thereto shall pass to Purchaser.
9.2 CUT-OFF TIME. The Cut-off Time shall be as of 11:59 p.m. on
the day preceding the Closing Date, except that Seller shall
receive the income and shall be charged for the expenses
attributable to the restaurants, bar facilities or room service
up to 2:00 a.m. on the Closing Date.
9.3 CLOSING STATEMENTS. At the Closing, Escrow shall deliver a
Preliminary Closing Statement setting forth in reasonable
detail prorations required under Article X based upon such
preliminary audits and inventories as they have made up to the
Closing Date. Within thirty (30) days following the Closing
Date, Escrow shall deliver a Final Closing Statement setting
forth the final determination of the adjustments and
prorations; PROVIDED, HOWEVER, that no adjustment shall be made
for any item included in the Preliminary Closing Statement if
the said item has been approved by Purchaser prior to the
Closing. A payment to cover any changes as a result of such
Final Closing Statement will be made by Seller or Purchaser, as
the case may be, within five (5) days after the receipt of such
Final Closing Statement.
In the event that, at any time within ninety (90) days after
the Closing, either party discovers any item which should have
been included in the Final Closing Statement but was not
included for any reason, then such item shall be adjusted in
accordance with this Agreement as if its existence had been
known at the time of the preparation of the Final Closing
Statement.
ARTICLE X
---------
CLOSING ADJUSTMENTS; OTHER CLOSING MATTERS
10.1 CLOSING ADJUSTMENTS. On the Closing Date the following items
shall be apportioned between Purchaser and Seller as of the
Cut-Off Time:
10.1.1 RENTS AND OTHER REVENUE. All Hotel revenues, including
percentage rents (if any) as and when collected;
PROVIDED, HOWEVER, that in connection with the
preparation of the Preliminary Closing Statement, as
provided in Section 9.3, any percentage rentals under
any Space Lease shall be estimated to the Cut-off Time
on the basis of sales, receipts or profits for
immediately preceding fiscal periods, and an adjustment
shall be made based upon actual figures, if available,
or again upon recently completed fiscal periods for the
purpose of making a final estimate of the amounts of
such percentage rentals in connection with the
preparation of the Final Closing Statement as provided
in Section 9.4. Guest room revenues for the night
immediately prior to the Closing Date shall be divided
equally between Seller and Purchaser;
10.1.2 TAXES, LEVIES, ETC. Real estate taxes and personal
property taxes, if any, levied or imposed upon the
Property on the basis of the fiscal year for which
assessed;
10.1.3 WATER CHARGES. Unmetered water charges on the basis of
the fiscal year;
10.1.4 UTILITIES. Charges and fees due under telephone
contracts and contracts for the supply of heat, water,
steam, electric power, gas and lighting or sewer; it
being further agreed that all deposits (including
interest actually accrued) made by Seller as security
under any such public service contracts (or any other
contracts being assumed by Purchaser hereunder) shall
be assigned to Purchaser and credited to Seller;
10.1.5 TENANT CHARGES. Charges due Seller for electric power,
steam or other utilities, submetering fees, charges for
chilled water and other charges for services furnished
to Space Lessees to the extent not adjusted pursuant to
Section 10.1.1;
10.1.6 HOTEL CONTRACTS AND EQUIPMENT LEASES. Charges and
receipts under all Hotel Contracts and Equipment
Leases;
10.1.7 PERMIT CHARGES AND FEES. Purchaser shall pay all
transfer or application fees for transferable Permits;
10.1.8 PAYMENTS TO OR FOR EMPLOYEES. Employees' wages
(including without limitation federal withholding and
employment taxes, and all state and local taxes, if
any, required to be collected by employers on personnel
working at the Hotel) vacation pay and other amounts
payable under any Seller's Obligations (in accordance
with the terms thereof) and payroll expenses shall be
paid by Seller.
10.1.9 OTHER ADJUSTMENTS. Such other items as are provided
for in this Agreement including but without limitation
all cash in house banks, the deposits under the Space
Leases, and advance payments under booking
arrangements.
10.2 EXCISE TAXES. Seller agrees to pay at the Closing any
applicable real estate excise tax and personal property
transfer/sales taxes except to the extent such personal
property transfer taxes are imposed by law on Purchaser.
10.3 CLOSING COSTS AND TITLE INSURANCE. Purchaser and Seller shall
each pay one-half of the applicable escrow fees and recording
costs. Seller shall pay the costs of title insurance
attributable to an owners standard ALTA coverage. Purchaser
may, at Purchaser's sole option, require extended form title
insurance and pay for the additional cost of such coverage
beyond that of standard form coverage and for any required
survey. Each party shall bear its own attorney's fees in
connection with this transaction.
ARTICLE XI
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DELIVERIES ON CLOSING
11.1 DELIVERIES BY SELLER. Seller shall make the following
deliveries to Purchaser at the Closing:
11.1.1 DEED. Seller shall execute, acknowledge and deliver to
Purchaser a warranty deed sufficient to convey to
Purchaser the fee simple title to the Land together
with the Improvements thereon, subject to and in
accordance with the provisions of this Agreement.
11.1.2 XXXX OF SALE AND REGISTRATIONS. Seller shall execute,
acknowledge and deliver to Purchaser a xxxx of sale and
title registration transfer documents (if any)
sufficient to transfer clear title and interest in and
to the Service Equipment, Consumables and Operating
Equipment subject to and in accordance with the
provisions of this Agreement and subject to Permitted
Exceptions, which shall state that the assets are being
acquired "AS IS WHERE IS" with the exception of those
representations and warranties expressly set forth in
this Agreement.
11.1.3 ASSIGNMENTS OF SPACE AND EQUIPMENT LEASES. Seller
shall execute, acknowledge and deliver to Purchaser, in
counterparts, an assignment of all of Seller's right,
title and interest as lessor under all Space Leases and
as lessee and owner under the Equipment Leases. Seller
shall also execute, acknowledge and deliver to
Purchaser, in counterparts, an assignment of all
security deposits then held by Seller pursuant to the
terms of Space Leases. Purchaser will decide and
notify Seller prior to the end of the Inspection Period
whether the estoppel statements provided by tenants
under Space Leases are adequate for Purchaser's
purposes.
11.1.4 ASSIGNMENT OF HOTEL CONTRACTS, TRANSFERABLE PERMITS,
NAMES AND MISCELLANEOUS ASSETS. Seller shall execute,
acknowledge and deliver to Purchaser an assignment of
all of Seller's right, title and interest under the
Hotel Contracts, transferable Permits, Names (to extent
transferable) and the Miscellaneous Assets to be sold
pursuant to this Agreement and shall deliver Seller's
original counterparts of all documents which are in
writing together with such correspondence and other
records, if any, pertaining thereto which Seller has.
Purchaser will decide and notify Seller prior to the
end of the Inspection Period if Purchaser wishes to
cancel any of the Hotel Contracts which are cancelable.
11.1.5 DOCUMENTATION REGARDING NON-TRANSFERABLE PERMITS. As
to any non-transferable Permits, Seller will, at
Purchaser's cost and expense, execute and deliver to
Purchaser any documents reasonably required to be
signed by Seller to effect the reissuance thereof in
the name of Purchaser.
11.1.6 CONSENTS/ESTOPPEL CERTIFICATES. Seller shall obtain
and deliver to Purchaser certificates from the lessees
under the Space Leases and from parties to each of the
material Hotel Contracts stating that said leases
and/or contracts are in full force and effect in
accordance with their terms, that to the best of their
knowledge there are no defaults thereunder, and that,
to the extent that the consent of such party is
required for the assignment thereof, such consent has
been given. Purchaser will decide and notify Seller
prior to the end of the Inspection Period whether the
certificates provided are adequate for Purchaser's
purpose and the contract shall terminate in accordance
with section 5.3.1 or any defeciencies in the
certificates will be deemed waived.
11.1.7 SELLER'S RECORDS. Seller shall deliver to Purchaser
all records pertaining to the then registration of
guests, advance bookings of banquets and similar
functions, advance room reservations, promotion
records, due bills, records of the purchasing and
engineering departments of the Hotel and all other
records, instruments, documents and deposits for Hotel
operation, except for such summaries or copies of such
records as Seller chooses to retain at its Seattle
office.
11.1.8 EMPLOYMENT AGREEMENTS AND CONTRACTS. Seller and
Purchaser shall provide a written notice to all
employees of the Hotel to terminate all employees of
the Hotel as of the Cut-off Date. The notice shall be
made in form acceptable to Purchaser.
11.1.9 TITLE INSURANCE AND ADDITIONAL ITEMS. Seller shall
deliver to Purchaser all other instruments and
documents to which Purchaser may be entitled at the
Closing under any of the other provisions of this
Agreement, including the allocation of Purchase Price
and policy of Title Insurance.
11.2 DELIVERIES BY PURCHASER. Purchaser shall make the following
deliveries to Seller at the Closing.
11.2.1 PURCHASE PRICE. Purchaser will execute and deliver
such documents as are necessary to reflect that the
Property is taken subject to the items described in
Article IV, and shall make any other payments required
by it hereunder.
11.2.2 ASSUMPTION OF SELLER'S OBLIGATIONS. Purchaser shall
execute, acknowledge and return to Seller counterparts
of the assignments delivered pursuant to Section 11.1
to evidence its agreement to assume and perform all of
the Seller's obligations under the Lease (as
negotiated), any Assumed Debt (as re-negotiated) Space
Leases, Hotel Contracts, and transferable Permits from
and after the Closing Date; together with its
obligation to pay all items for which it has received a
credit at Closing and to indemnify Seller with regard
thereto.
11.2.3 ASSUMPTION OF BOOKINGS. Purchaser shall execute,
acknowledge and deliver to Seller an agreement on
Purchaser's part to perform all booking arrangements at
the Hotel from and after the Closing insofar as the
same have been made by Seller pursuant to Section 7.5.
11.2.5 ADDITIONAL ITEMS. Purchaser shall deliver to Seller
all instruments and documents to which Seller may be
entitled at the Closing under any of the other
provisions of this Agreement.
11.3 NOTICES
11.3.1 TENANTS UNDER LEASES. Seller and Purchaser shall
execute and deliver all notices to all Space Lessees
advising them of the sale of the Property, the
assignment to Purchaser of the Space Leases, and the
assumption by Purchaser of the lessor's obligations
under such Space Leases.
11.3.2 OTHER NOTICES. Upon request of either party, Seller
and Purchaser will execute and mail a notice addressed
to the other party under any Equipment Lease, Hotel
Contract, or to the governmental or other authority
issuing any Permit assigned to Purchaser, notifying
such person or authority of such assignment, and of the
assumption of Purchaser of Seller's obligations
thereunder.
ARTICLE XII
-----------
CONDITIONS TO CLOSING OBLIGATIONS
12.1 CONDITIONS TO SELLER'S OBLIGATION TO CLOSE. The obligation of
Seller to consummate the transactions contemplated by this
Agreement, including the sale of the Property, is expressly
conditioned upon the fulfillment by and as of the time of
Closing of each of the conditions listed below in this Section
12.1; PROVIDED, HOWEVER, that Seller, at its election, may
waive all or any of such conditions:
12.1.1 PERFORMANCE OF AGREEMENTS. Purchaser shall have
performed all of its agreements contained in this
Agreement required to be performed by it prior to the
Closing Date (including but without limitation the
adjustments and other closing matters provided for in
Articles IX and X).
12.1.2 REPRESENTATIONS AND WARRANTIES. The representations
and warranties of Purchaser contained in this Agreement
shall, except as contemplated or permitted by this
Agreement, be true (regardless of the knowledge, or
lack thereof, of Purchaser) on and as of the Closing
Date, as if made on and as of the Closing Date, in all
respects except for instances which are, in the
aggregate, not material.
12.1.3 TENDER. Purchaser shall have tendered to Seller the
delivery of the items contemplated in Section 11.2.
12.2 CONDITIONS TO PURCHASER'S OBLIGATION TO CLOSE. The obligation
of Purchaser to consummate the transactions contemplated by
this Agreement, including the sale and purchase of the
Property, is expressly conditioned upon the fulfillment by and
as of the time of the Closing of each of the conditions listed
below in this Section 12.2; PROVIDED, HOWEVER, that Purchaser,
at its election evidenced by written notice delivered to Seller
prior to or at the Closing, may waive any or all of such
conditions:
12.2.1 PERFORMANCE OF AGREEMENTS; ADVERSE CHANGES. Seller
shall have performed all of its agreements contained in
this Agreement required to be performed by it prior to
the Closing Date (including but without limitation the
adjustments and other closing matters provided for in
Articles IX and X), and there shall have been no
material permanent adverse change in the total
conditions (financial or otherwise), assets,
liabilities, earnings, or business of Seller or the
Hotel, as described in Section 5, taken as a whole,
since the date of this Agreement.
12.2.2 REPRESENTATIONS AND WARRANTIES. The representations
and warranties of Seller contained in this Agreement
shall, except as contemplated or permitted by this
Agreement to be limited to the best of Seller's
knowledge, or as required or consented to by Purchaser
under Section 7.2, be true on and as of the Closing
Date, as if made on and as of the Closing Date, in all
respects except for instances which are, in the
aggregate, not material.
12.2.3 LITIGATION. There shall be no pending or threatened
litigation seeking to restrain, prevent, rescind, or
change the terms of the sale and purchase of the
Property from that which is set forth herein, or to
obtain damages in connection with said sale and
purchase which, in Purchaser's opinion, makes it
inadvisable to proceed with said sale and purchase, or
which, in Purchaser's opinion might materially and
adversely affect the total condition (financial or
otherwise), assets, liabilities, earnings or business
of the Hotel.
12.2.4 TENDER. Seller shall have tendered to Purchaser the
delivery of the items contemplated in Section 11.1.
12.2.5 EQUIPMENT LEASES. The holders of Equipment Leases
shall have approved the transfer of the Property
without change in terms or charge to Purchaser.
ARTICLE XIII
------------
GENERAL PROVISIONS
13.1 FIRE OR OTHER CASUALTY OR CONDEMNATION.
13.1.1 NOTICE TO PURCHASER. Seller agrees to give Purchaser
prompt notice of any fire or other casualty occurring
at or to the Property between the date of this
Agreement and the Closing Date, or of any actual or
threatened condemnation of all or any part of the Land
of which Seller has knowledge.
13.1.2 MAJOR CASUALTY OR TAKING. If, prior to the Closing,
there shall occur (i) Damage to the Property caused by
fire or other casualty which would cost Five Hundred
Thousand Dollars ($500,000) or more to repair, or (ii)
a taking by condemnation of any part of the
Improvements or which materially interferes with the
operation or use of the Hotel, then, and in either such
event, Purchaser may terminate its obligations under
this Agreement by written notice given to Seller within
fifteen (15) days after Seller has given Purchaser the
notice referred to in Section 13.1.1, or at the
Closing, whichever is earlier and receive the return of
the Xxxxxxx Money. If Purchaser does not so elect to
terminate its obligations under this Agreement, then
the Closing shall take place as herein provided without
abatement of the Purchase Price, and Seller shall
assign to Purchaser at the Closing, by written
instrument, all of Seller's interest in any insurance
proceeds (except use and occupancy insurance and
business interruption insurance for the period ending
with the Closing Date) or condemnation awards which may
be payable to Seller on account of any such fire,
casualty or condemnation awards which may be payable to
Seller on account of any such fire, casualty or
condemnation, or the amount thereof not expended for or
required to reimburse Seller for actual expenditures on
account of restoration.
13.1.3 OTHER CASUALTY OR TAKING. If, prior to Closing, there
shall occur (i) damage to the Premises caused by fire
or other casualty which would cost less than Five
Hundred Thousand Dollars ($500,000) to repair, or, (ii)
a taking by condemnation of any part of the Premises
which does not include a material part of the
Improvements or does not materially interfere with the
operation or use of the Hotel, then, and in any such
event, neither party shall have the right to terminate
its obligations under this Agreement by reason thereof
and the Closing shall take place without abatement of
the Purchase Price, but Seller shall assign to
Purchaser at the Closing, by written instrument all of
Seller's interest in any insurance proceeds (except use
and occupancy insurance and business interruption
insurance for the period ending with the Closing Date)
or condemnation awards which may be payable to Seller
on account of any such fire, casualty or condemnation,
or the amount thereof not previously expended for or
required to reimburse Seller for actual expenditures on
account of restoration. Notwithstanding the foregoing,
if any such damage due to fire or other casualty is not
covered by insurance and Seller does not make available
to Purchaser funds equivalent to those which would have
been available under such insurance, then Purchaser
shall have a right to terminate this Agreement in the
manner provided in Section 13.1.2 regardless of the
extent of the damage.
13.1.4 DEFINITION OF MATERIAL TAKING. For purposes of this
Section 13.1, a taking of a material part of the
improvements shall mean any taking which leaves
remaining a balance of the Premises which may not be
economically operated for the purpose for which the
Premises was operated prior to such taking. Without
limiting the generality of the foregoing, a taking of
more than ten percent (10%) of the common areas of the
Improvements (including, without limitation, the
lobbies, ballrooms, bars, dining areas, corridors,
cellars, storage or service equipment areas) or more
than fifteen percent (15%) of the guest areas of the
Improvements (including, without limitation, all
private rooms, bathrooms and the like) shall be deemed
to be material and materially to interfere with the
business and operation of the Hotel.
13.2 TERMINATION
13.2.1 BY SELLER. Seller may terminate this Agreement by
providing 15 days notice and opportunity to cure to
Purchaser at any time prior to the Closing Date if a
material default under or a material breach of this
Agreement or any representation or warranty set forth
in this Agreement or in any instrument delivered by
Purchaser pursuant hereto shall be made by Purchaser.
13.2.2 BY PURCHASER. Purchaser may terminate this Agreement
by 15 days notice and opportunity to cure to Seller at
any time prior to the Closing Date if:
(A) A condition to the performance of Purchaser
hereunder shall not be satisfied on or before
the date specified for the satisfaction thereof;
or
(B) A material default under or a material breach of
this Agreement or of any representation or
warranty set forth in this Agreement or in any
instrument delivered by Seller pursuant hereto
shall be made by Seller.
13.2.3 EFFECT OF TERMINATION. In the event of termination of
this Agreement under this Section 13.2, then:
(A) The Xxxxxxx Money deposit of Purchaser shall be
returned unless Purchaser is the party in
default; and
(B) In the event the Agreement is terminated and the
Closing is not consummated by reason of default
of a party hereunder, if Purchaser is the
defaulting party, Seller shall retain the
Xxxxxxx Money as its sole and exclusive remedy;
and if Seller is the defaulting party, Purchaser
may bring an action for specific performance,
xxx for damages, or pursue any other remedy it
may have at law.
13.3 ASSUMPTION OF LIABILITIES.
13.3.1 LIMITATION ON ASSUMED LIABILITIES. Purchaser is not
assuming any liabilities of Seller except liabilities
which the terms of this Agreement expressly require
Purchaser to assume.
13.3.2 SPECIFIC EXCLUSION OF ASSUMED LIABILITIES. Without
limiting the generality of Section 13.3.1, Purchaser is
not assuming any liability of Seller in respect of the
following:
(A) Any of Seller's trade payables applicable to the
period prior to Closing;
(B) Any contingent liability of Seller whether for
taxes or otherwise;
(C) Any liability on account of any employment
agreement, welfare or other employee or fringe
benefit plan, or any other or similar plan or
any retirement, bonus, severance pay, insurance,
profit sharing or deferred compensation plan; or
(D) Any liability of Seller hereunder for fees,
expenses or taxes incurred in connection with
the sale and transfer of the Property.
13.3.3 EFFECTIVE DATE OF ASSUMPTION. Wherever it is provided
in this Agreement that Purchaser shall assume all
obligations of Seller, such assumption shall be
effective only from and after the Closing Date and no
such assumption shall require Purchaser to assume, nor
shall it assume, any liabilities or obligations of
Seller relating to or arising from Seller's performance
of, or failure to perform, any of the terms of the
assumed obligation prior to the Closing Date (except as
otherwise expressly provided in this Agreement.)
13.4 SURVIVAL OF REPRESENTATIONS, ETC. Subject to the time
limitations described in section 5.2, the respective
representations, warranties, obligations, covenants and
agreements of Seller and Purchaser contained herein shall
survive Closing.
13.5 INDEMNIFICATION.
13.5.1 AGREEMENT TO INDEMNIFY. Subject to the express
provisions of this Agreement to the contrary, the
Seller will indemnify Purchaser against any liability
for claims arising out of events, acts, or omissions of
Seller that occurred in connection with the operation
of the Hotel up to the Closing Date, and Purchaser will
indemnify the Seller against any liability for claims
arising out of events, acts or omissions of Purchaser
that occur in connection with the operation of the
Hotel on or after the Closing Date.
13.5.2 INDEMNIFICATION REGARDING ASSUMED OBLIGATIONS.
Whenever it is provided in this Agreement that an
obligation of one party will be assumed by the other
party from and after the Closing Date, the party so
assuming such liability shall be deemed to have also
agreed to indemnify and hold harmless the other party,
its successors and assigns, from all claims, losses,
liabilities and expenses (including reasonable
attorneys' and accountants' fees) arising from any
failure of the assuming party to perform the obligation
so assumed from and after the Closing Date.
13.5.3 NOTICE AND COOPERATION ON INDEMNIFICATION. Subject to
the time limitations contained in section 5.2, whenever
any party shall learn through the filing of a claim or
the commencement of a proceeding or otherwise of the
existence of any liability for which another party is
or may be responsible under this Agreement, such party
shall notify said other party promptly and furnish such
copies of documents (and make originals thereof
available) and such other information as such party may
have which may be used or useful in defense of such
claims and shall afford said other party full
opportunity to defend the same in the name of any party
and shall generally cooperate with said other party in
the defense of any such claim.
13.6 ASSIGNMENTS AND SECTION 1031 EXCHANGE. Without the prior
written consent of the other party, neither party may assign
its rights hereunder except that Purchaser may assign its
rights hereunder to any entity of which Cavanaughs Hospitality
Corporation is the parent, manager or general partner, so long
as Cavanaughs Hospitality Corporation remains liable for and
responsible for performance of all obligations hereunder and
payment of the Purchase Price. Cavanaughs Hospitality
Corporation shall be liable for all obligations of Purchaser
under this Agreement. Purchaser agrees to cooperate with
Seller in allowing Seller to accomplish a deferral of taxes
under the provisions of Section 1031 of the Internal Revenue
Code (including advance funding up to two days prior to Closing
in the amount required to allow Seller or its affiliates to
acquire the Washington Mutual note or deposit of funds into
specified accounts by Purchaser's affiliates), provided that
such cooperation shall not result in any expense or liability
to Purchaser or defect in title or risk to acquiring title to
the Property other than that which Purchaser would have in a
simple all cash purchase transaction. The deferral of tax
arising out of this transaction is not a contingency to the
obligations of Seller under this Agreement.
13.7 BROKERS. Seller shall pay all commissions or other fees to
Colliers International under the terms of a separate agreement
between Seller and Colliers. The parties represent and warrant
to one another that they have not dealt with any other broker
to whom they are obligated to pay a fee in connection with the
sale of the Property.
13.8 EXPENSES, FEES AND DISBURSEMENTS OF COUNSEL. Except as
otherwise provided in this Agreement, each of the parties
hereto shall bear and pay their respective expenses, including
without limitation the fees and disbursements of their own
counsel, accountants and other advisors, in connection with the
negotiation and preparation of this Agreement and the Closing.
13.9 NOTICES. Except as otherwise provided in this Agreement,
notices, demands, requests, consents, approvals or other
communications (for the purpose of this Section 13.9
collectively called "Notices") required or permitted to be
given hereunder or which are given with respect to this
Agreement shall be in writing and shall be considered given
when sent by United States registered or certified mail,
postage prepaid, (or by private overnight courier) addressed to
Purchaser at 000 X. Xxxxx Xxxxx Xxxxx Xxxxx 000, Xxxxxxx, XX
00000 Attn. President and to Seller at Stellar International
Holdings, 000 Xxxx Xxxxxx Xxxxx 0000, Xxxxxxx, XX 00000 attn.
Xxxxxx Xxxxxx, or such other place as a party may from time to
time designate by notice, or when personally delivered.
13.10 COUNTERPARTS, FACSIMILES, CAPTIONS, ETC. This Agreement may be
executed in counterparts, each of which shall be deemed an
original, and all of which shall constitute one and the same
instrument. The facsimile transmittal of an executed document,
to be followed as soon as practical by delivery of the original
signed document, shall be considered delivery of an original
when transmitted to Seller at 000-000-0000 or to Purchaser at
000-000-0000. The captions are for convenience of reference
only, and shall not affect the meaning or construction to be
given any of the provisions hereof. All pronouns and any
variations thereof shall be deemed to refer to the masculine,
feminine or neuter, singular or plural, as the identity of the
parties may require.
13.11 GOVERNING LAW. This Agreement shall be governed by,
interpreted under, and construed and enforced in accordance
with, the laws of the State of Washington, except to the extent
required to enforce specific performance under the laws of the
State of Utah where the Property is located. In addition to
any other remedy, the substantially prevailing party in any
dispute arising out of this Agreement shall be entitled to
recover their reasonable attorney fees and costs of litigation.
13.12 ENTIRE AGREEMENT; NO RECORDING. This Agreement contains the
entire agreement between the parties with respect to the
subject matter hereof and supersedes all prior understandings
with respect thereto. This Agreement may not be modified,
changed, supplemented or terminated, nor may any obligations
hereunder be waived, except by written instrument signed by the
party to be charged by its agent duly authorized in writing or
as otherwise expressly permitted herein. Subject to Section
13.6, this Agreement shall be binding upon and inure to the
benefit of their successors and assigns. The parties do not
intend to confer any benefit hereunder on any person, firm or
corporation other than the parties hereto. The parties each
agree that neither this Agreement nor any memorandum thereof
shall be recorded.
13.13 NO WAIVERS. No waiver of any breach of any agreement or
provision herein contained shall be deemed a waiver of any
preceding or succeeding breach thereof or of any other
agreement or provision herein contained. No extension of time
for performance of any obligations or acts shall be deemed an
extension of the time for performance of any other obligations
or acts.
13.14. CONFIDENTIALITY Neither party will make any disclosure of this
Agreement except to the extent required to comply with the
obligations of the parties under this Agreement or to comply
with the obligations of that party under applicable laws and
regulations. In the event Purchaser does not waive its
contingencies to its obligations to purchase, Purchaser shall
return to Seller all materials which it obtains from Seller,
and Seller may acquire from Purchaser any third party reports
on the Property ordered by Purchaser during the Inspection
Period by reimbursing Purchaser for the cost of such report.
THE OFFER REPRESENTED BY THE FIRST PARTY EXECUTING AND DELIVERING THIS
AGREEMENT IS WITHDRAWN UNLESS THE OTHER PARTY EXECUTES THIS AGREEMENT
WITHOUT MODIFICATION AND DELIVERS IT TO THE ORIGINAL SIGNING PARTY ON
OR BEFORE 5:00 P.M. OF THE THIRD BUSINESS DAY FOLLOWING THE DATE OF
THE FIRST PARTY SIGNING.
IN WITNESS WHEREOF, each party hereto has caused this Agreement to be
executed on its behalf by and through its managing partner and
attested to by its officers thereunto duly authorized, all on the date
first above written.
SELLER: PURCHASER:
STELLAR LONE STAR, L.L.C. CAVANAUGHS HOSPITALITY LIMITED
by X-X Corporation, Member PARTNERSHIP
by Cavanaughs Hospitality
Corporation, General Partner
/s/ Xxxx Xxxxxxx by /s/ Art Xxxxxx
------------------------------ -----------------------------
its President, X-X Corporation Art Xxxxxx, Executive Vice
President
STATE OF WASHINGTON
) SS.
County of Spokane
I certify that I know or have satisfactory evidence Art Xxxxxx is the
person who appeared before me, and said person acknowledged that he
signed this instrument, on oath stated that he was authorized to
execute the instrument and acknowledged it as the Executive Vice
President of Cavanaughs Hospitality Corporation, the sole General
Partner of Cavanaughs Hospitality Limited Partnership, to be the free
and voluntary act of such party for the uses and purposes mentioned in
the instrument.
Dated: April 28, 1998.
Xxxxxxxx Xxxxxxxxx
Type/Print Name of Notary: __________________________________
Notary Public in And For the State
of Washington,residing at
Spokane.
My appointment expires: 01/06/02.
STATE OF WASHINGTON
) SS.
County of King
I certify that I know or have satisfactory evidence that Xxxx Xxxxxxx
is the person who appeared before me, and said person acknowledged
that (he/she) signed this instrument, on oath stated that (he/she) was
authorized to execute the instrument and acknowledged it to be the
free and voluntary act of such party as the President of X-X
Corporation, Member of Stellar Lone Star, L.L.C. for the uses and
purposes mentioned in the instrument.
Dated: April 29, 1998.
Xxxx Xxxxxxxxx
Type/Print Name of Notary: __________________________________
Notary Public in And For the State
of Washington,residing at
Newcastle.
My appointment expires: 02/01/00.
EXHIBIT A
(Legal Description of Hotel)
EXHIBIT B
(Legal Description of Rental Property)
EXHIBIT C
(Due Diligence Request List)
To the extent available, information on this exhibit will be provided
at the Hotel.
A. FINANCIAL
---------
A1. Balance Sheets and Income Statements
[ ] Copies of past three years' year-end audited balance sheet and
income statements.
[ ] Copies of most recent month's balance sheet and income
statements.
A2. Financial Statements/P&L's
[ ] Copies of past three years' monthly detail profit and loss
statements listing all income and expense categories by
department.
[ ] Copies of monthly profit and loss statements for each department
from the end of the prior fiscal year to and including the most
recently completed month.
A3. Budgets
[ ] Past year's operating income and expense budgets by department.
[ ] Current year's operating income and expense budgets by
department.
A4. Depreciation Schedules
[ ] List of all personal and real property including initial value,
date of acquisition, accumulated depreciation, and scheduled
monthly or annual depreciation.
A5. Debt
[ ] Complete copies of all mortgages or other loans secured by real
property including copies of original agreements and any
modifications and/or amendments.
[ ] Copy of a debt schedule, listing, the name of the lender, loan
officer, addresses, phone number, current balance, annual
percentage rate (APR), maturity date, current payment amounts
and payment periods, current interest amounts, balloon payments,
and prepayment penalties.
[ ] Copies of all leases in which the hotel is the lessee. Include
copies of all furniture and equipment leases with terms, monthly
payments, and buy out options.
A6. Real Estate Tax
[ ] Copies of past three year's property tax bills, including
assessed valuations for land, improvements, and personal
property, and any homestead exemptions if applicable.
[ ] Copies of current year's assessments and tax bills.
A7. Aged Accounts Receivable
[ ] Copy of current aged accounts receivable report
A8. General Ledger
[ ] Cavanaughs designee to review GL on-site with property general
manager and controller.
A9. Purchase Journal
[ ] Copies of monthly purchase journals for past 6 months.
B. MAJOR AGREEMENTS
----------------
B1. Franchise Agreement and Inspections
[ ] Copy of Franchise Agreement if applicable, including costs,
restrictions, policies and terms and any modifications and/or
amendments.
[ ] Copies of Franchise Inspection Reports from the past two years.
B2. Leases
[ ] Copies of any retail leases or agreements for any portion of the
Improvements. Include all attachments and exhibits to leases,
and any modifications and/or amendments.
[ ] Copy of current rent roll, listing all tenants, monthly base
rent, percentage rent as applicable, and term of lease.
[ ] Copies of most recent Estoppel Agreements executed by tenants,
if applicable.
B3. Management Contract
[ ] Copy of Management Contract if applicable, including any
modifications and/or amendments
B4. Service Contracts
[ ] Copies of any maintenance and/or service agreements and
contracts, i.e. elevator, fire alarm monitoring and/or service,
fire sprinkler inspection, landscaping, contract cleaning, etc.
C. ENGINEERING
-----------
C1. Site Survey/Plot Plan
[ ] Copy of engineered site survey or plot plan showing property
boundaries, buildings, parking layout, and major utilities.
C2. Environmental Reports
[ ] Copy of Phase I assessment. If older than one year, a
transaction screen update will be required.
[ ] Copy of Phase II analysis and report if performed.
C3. ADA Compliance
[ ] Copies of ADA compliance survey and/or certifications to lenders
of ADA compliance.
C4. Asbestos Abatement/Management
[ ] Copies of asbestos surveys and abatement reports as applicable.
[ ] Copy of PACM (Presumed Asbestos Containing Material) Management
Plan if applicable (required by Federal regulations for all
public and commercial buildings constructed before 1980).
C5. Utility Bills
[ ] Copies of the last 12 months Sewer, Water, Refuse, Gas, and
Electricity bills showing monthly consumption and invoiced
amount.
C6. Building Plans
[ ] Cavanaughs designee to review building plans on-site.
C7. Inspection Reports for Fire Protection Equipment
[ ] Most recent inspection report for fire alarm system and date of
next inspection as required by State and/or local ordinance.
[ ] Most recent inspection report for automatic fire sprinkler
system and date of next inspection as required by State and/or
local ordinance.
[ ] Date of most recent inspection and/or service of hand held fire
extinguishers and copy of service invoice or inspection report.
[ ] Date of most recent inspection and cleaning of kitchen hoods and
grease ducts and copy of service invoice or inspection report.
C8. Engineering Studies and Construction Specifications
[ ] Cavanaughs designee to review on-site, copies of soils report,
building, mechanical and electrical construction specifications,
and any engineering studies available for the property.
[ ] Copy of any seismic analysis of the building(s).
C9. Room FF&E Replacement Schedule
[ ] Dates of last upgrade of carpet, soft goods, case goods, and
wall finishes for all guestrooms, organized by building, room
wing, floor, groups of rooms, or individual guestroom as
appropriate to allow determination of the age of any of these
elements for any particular guestroom.
C10. Major Equipment List
[ ] Schedule of major kitchen and laundry equipment, listing item
description, brand name, capacity, age, and initial value (this
information may be included in item A4).
C11. Capital Expenditures
[ ] Copy of capital expenditure plan for the current fiscal year.
[ ] List of actual capital expenditures for the past three years.
C12. Room Layout
[ ] Plan showing guestroom buildings and/or room wings labeled with
the descriptors commonly used by hotel staff, i.e. "North Wing",
"Bldg A", "Corporate Floor", etc.
[ ] Copy of a numbering plan with list of room types and map showing
room numbers.
C13. Elevator Inspection Reports
[ ] Copy of most recent elevator inspection report.
[ ] Date of last 5 year Full-Load Safety Test and copy of report
(not required for hydraulic elevators).
C14. Chief Engineer Facility Questionnaire
[ ] Completed copy of CHC facility questionnaire.
C15. Citations and Violations
[ ] Copies of any outstanding citations or violations of building
ordinances or codes.
C16. Zoning Requirements
[ ] Copy of parking analysis showing car parks required for present
guestroom, banquet, restaurant, lounge and other uses.
[ ] Copy of zoning ordinance sections showing height restrictions
and any floor area ratio (FAR) limits for the property.
C17. Parking Facilities
[ ] Plan view of parking layout showing number of parking stalls,
and location of all ADA accessible stalls (may be included in
item C1).
D. FOOD AND BEVERAGE
-----------------
D1. Liquor License
[ ] Copy of current liquor license
[ ] Documentation of any Liquor Board Violations and Citations.
D2. Health Department Permits
[ ] Copies of current Health Department Permits
[ ] Copies of any Health Department inspection reports from the past
12 months.
[ ] Documentation of any Health Department Citations and Violations
D3. F&B Inventories
[ ] Food and beverage inventories for past three months
E. SALES AND MARKETING
-------------------
E1. Marketing Plan
[ ] Copy of marketing plan for current fiscal year
E2. Sales Budget
[ ] Copy of sales department budget, Including travel expenses,
printing expenses, and any other operating expenses
E3. Competition Survey
[ ] Narrative description of the local competitive set, including
rates, occupancies, condition of properties, etc.
E4. Xxxxx Travel Research (STAR) Report
[ ] Most recent STAR Trend Report, giving penetration and yield
statistics versus competitive set.
E5. Group Rooms Booking Report
[ ] List of Organization Names and Room Nights Booked for three
years out and three years past, (include definite AND tentative
rooms booked)
E6. Market Segmentation
[ ] Market segment breakdown of business for the past three years
showing the percentage of business (both room nights and room
revenue) from each market segment such as "Convention/Group",
"Special Corporate" (corporate business with a negotiated rate),
"Permanent", "Corporate/Transient", "Discount/Leisure",
"Government" and "Rack".
E7. Advertising Agreements
[ ] Copies of contracts for billboard advertising, airport
advertising, print advertising, radio agreements (including
tradeouts), and all other advertising agreements.
E8. Sponsorship Agreements
[ ] Copies of any documents or agreements pertaining to current or
future sponsorship agreements.
F. LEGAL
-----
F1. Litigation
[ ] Details of any current and pending litigation claims.
F2. Title Report
[ ] Preliminary Title Commitment including legible copies of ALL
exceptions to title.
F3. Certificates of Occupancy
[ ] All Improvements
[ ] Restaurants and Lounges
[ ] Other
F4. Property and Liability Insurance
[ ] Summary of Coverage showing limits of coverage, deductibles and
annual premiums.
[ ] Insurance loss recap for past three years.
G. HUMAN RESOURCES
---------------
G1. Organizational Structure
[ ] Copy of Organizational Chart of all management staff.
G2. Personnel
[ ] List of all employees, including job title and date of hire.
[ ] Employee compensation schedule including base pay and bonus
plans for all Salaried and Hourly employees, and all levels of
management.
G3. Employee Policies and Benefits
[ ] Copy of Employee Handbook including Personnel Policies, Benefit
Programs, Standards of Conduct, etc.
[ ] Provide the following information for all benefit plans offered
to employees: Eligibility Criteria; Summary of Benefits and Plan
Booklets; Provider Booklets; Employer and Employee Monthly
Premium Amounts.
G4. Collective Bargaining Agreements
[ ] Copies of any union contracts including any associated benefit
programs.
EXHIBIT D
(Facility Inspection Questionnaire)
This questionnaire is intended to form the basis for on-site
inspection and review of the subject property and will serve as a
guideline for interviewing the Chief Engineer regarding these matters.
Please take the time to answer the questions to the fullest extent
possible so that the on-site inspection and interview time can be kept
to a minimum.
ADA Compliance
--------------
Has a professionally prepared survey been made of the property to
evaluate its compliance with the Americans With Disabilities Act
(ADA)? If so, skip the balance of this section. If not, please
answer the following:
[ ] How many accessible parking stalls are located on the property?
[ ] Are they identified with international symbols painted on the
pavement?
[ ] Are they identified with pole mounted signs?
[ ] What is the accessible route from the parking stalls to the
building entrances?
[ ] Describe the type of entrance doors to each major building area
and how they comply with ADA requirements.
[ ] Are there any impediments to wheelchair access to any buildings,
or any public areas of any buildings? If so, describe.
[ ] Is there an area of the front desk suitable for a wheelchair
bound guest to check in and out of the facility? If not, what
other accommodations have been made to address this need?
[ ] Are there handicap accessible restrooms near the public assembly
areas of the hotel? Identify their number and location.
[ ] Are there accessible drinking fountains near the public assembly
areas of the hotel? Identify their number and location.
[ ] Are there accessible telephones near the public assembly areas
of the hotel? Identify their number and location.
[ ] How many handicap accessible guestrooms are on the property?
List the room numbers, and identify which ones have tubs and
which ones have roll-in showers. Do any of these rooms have
special accommodations for the hearing impaired? If so, which
ones?
[ ] Are the individual guestroom room numbers ADA compliant? Do
they have raised Braille numbers in addition to visual contrast
between the background and the number? Are they located
adjacent to the latch side of the door or on the door?
Fire Suppression Systems
------------------------
[ ] Does the property have an automatic fire sprinkler system? If
so, what areas are served, i.e. public areas, guestroom
corridors, guestrooms?
[ ] Are there any unsprinklered areas?
[ ] What is the size of the sprinkler water service?
[ ] Is there a redundant supply?
[ ] Describe the type of backflow prevention devices isolating the
sprinkler system from the potable water supply (i.e. single
check, double check, detector check, reduced pressure)?
[ ] Are there any fire pumps incorporated in the system? If so,
describe the capacity (gpm, psi, hp). Is the fire pump on an
emergency generator?
[ ] Describe the fire suppression system for the kitchen hoods
(water or chemical, and type of chemical). Are hood suppression
systems owned or leased? Who provides service for the hood
systems?
[ ] Describe the number and location of fire hydrants adjacent to
the property.
[ ] Describe the type and location of standpipes throughout the
facility. Are they wet or dry?
[ ] Are chemical fire extinguishers located in all hallways? What
type are used? Who provides service for the extinguishers?
What other locations have fire extinguishers?
Fire Alarm
----------
[ ] Is there a fire alarm system on the property? If so, what areas
are served?
[ ] Are there any areas not covered?
[ ] Is the system owned or leased?
[ ] Is the system "supervised" (monitored) by an independent entity?
If so, identify the monitoring company.
[ ] If not, where is the local alarm panel, and what procedures are
in place to notify the Fire Department in the event of an alarm?
Is this procedure approved by the local Fire Department?
[ ] What is the location of the fire control panel(s).
[ ] Identify the manufacturer and model number of the control panel.
[ ] Does the system have any public address communications
capabilities? If so, describe what areas are served?
[ ] Does the system have smoke detectors in public areas and
guestroom hallways?
[ ] Does the system include smoke detectors in individual
guestrooms? If not, do guestrooms have independent smoke
detectors? If so, are they hard wired or battery? If hard
wired, do they have any backup power? If so, what form?
[ ] What type of local alarm device is used, horns, strobes, bells
or a combination? Identify what type is used and in which
locations.
[ ] Are pull stations located adjacent to all exits?
[ ] How frequently is the system tested? Who performs the tests?
Are test results submitted to the Fire Department? Are copies
of the test results kept at the property? If not, where are
they kept?
Kitchens
--------
[ ] An equipment list is to be provided as item C10 of the CHC Due
Diligence Information Request.
[ ] Describe the types of kitchen hoods. How frequently are they
cleaned? How frequently are the grease ducts cleaned? Who
performs this cleaning?
[ ] Is there a grease trap in the waste line? Where is it located,
what is its capacity, and what equipment does it serve? How
often is it emptied? Who performs this procedure? Where is the
waste discharged?
[ ] Are there any open fryers in the kitchen? If so, what is the
clearance between the fryers and the nearest open flame xxxx
top?
[ ] What is the flooring material in the kitchen? What type of
flooring is in the service areas? What type of base is used?
What is the condition of the flooring?
[ ] What material is used on the walls?
[ ] What material is used on the ceilings?
[ ] What type of light fixtures are used in the kitchen and service
areas?
[ ] List the number and size of the walk-in freezers and coolers?
Are they water cooled or air cooled? If water cooled, is the
water wasted to the sewer? If not, where is it discharged, and
is the property still billed a sewer charge for this water?
[ ] What refrigerant is used in the freezers and coolers?
Laundry
-------
[ ] An equipment list is to be provided as item C10 of the CHC Due
Diligence Information Request.
[ ] Are dryers gas or electric?
[ ] How are dryers vented? Is there an external lint trap? If so,
where is it located? How often is it cleaned? Is there any
significant lint carryover?
[ ] Is the laundry served with soft water?
[ ] Does the laundry have its own hot water heater?
[ ] What is the condition of the laundry equipment? Describe any
recurring maintenance or repair problems.
[ ] How is the laundry ventilated? Is there any active cooling? If
so, describe. What is the winter heat source?
Elevators
---------
[ ] Identify each elevator by it's common in-house identifier
(elevator number, area description, or functional description as
used to report problems with any particular elevator). List the
elevator type (hydraulic, geared traction, gearless traction,
etc.), manufacturer, and capacity.
[ ] Identify any non ADA compliant features (hall or car call
buttons, door edges, floor passing gongs, hand rails, ADA phone,
etc.). Have quotes for ADA upgrades been obtained?
[ ] Where are elevator phones monitored?
[ ] Are there any other communication devices and/or security
devices in the elevators? If so, describe.
[ ] Describe dispatch control type and age of controls.
[ ] Describe drive type for traction elevators (motor generator,
variable voltage and frequency AC, SCR DC, etc.)
[ ] Describe machine room climate controls. Have there been any
problems with temperature control?
[ ] Where are operating permits kept?
[ ] Are all permits current?
[ ] Are there any pending issues with the elevator inspector?
Electrical
----------
[ ] Describe the electrical service to the property. Is there more
than one service entrance/metering point? If so, identify what
building functions and/or areas are served by each meter.
[ ] Where are meters and main switchgear located?
[ ] What is the primary service voltage and ampacity?
[ ] Is three phase power available, and at what voltage?
[ ] Are there primary power transformers on site? If so, are they
owned by the utility company or the property? Where are they
located?
[ ] Are there any PCB's in any of the transformers? If so, describe
their location.
[ ] Where are distribution panels located?
[ ] Where are the branch panels that serve the guestrooms located?
Are more than one guestroom served from a common breaker?
[ ] Are the outlets in the bathroom or near outside vanities
protected with GFIC breakers or outlets? Is each guestroom
protected independently? If not, describe the interconnection.
[ ] Describe the emergency lighting for the property. Is there an
emergency generator? If so, what is the capacity and fuel
source? Where is the generator located? How often is it
tested, and by whom? If battery backup exit lights and/or
emergency lights are used, how often are they tested, and by
whom?
Plumbing
--------
[ ] What is the size of the water service to the property? Is there
a redundant supply? Is there more than one metering point? If
so, describe the location and what building areas or uses are
served by each meter.
[ ] Is landscape irrigation water fed from the same metered source?
If so, how is the sewer charge computed during the summer
irrigation period?
[ ] Identify all backflow prevention devices in the domestic water
system. Are these devices mandated by local and/or state
ordinances? How frequently are they tested, and by whom? Are
test records kept at the property?
[ ] Is the property served by a public sewer system? If not, how is
sewage treated?
[ ] Does the property have any sewer lift stations, sump pumps or
grinder pumps? If so, describe their function and location.
Have there been any problems with any such systems?
[ ] Are there any water softeners on the property? If so, what
areas are served? Is only hot water softened? What type of
softeners are used, and who maintains the equipment?
[ ] Describe the domestic hot water systems. What type of
heaters/boilers are used? What is their fuel type? If fossil
fueled, are they natural draft or forced draft units? List the
capacity and area served for each system. List any storage
capacity and whether integral to the heater or a separate
storage tank.
[ ] Describe any hot water recirculation systems. Have there been
any problems with leaks in the recirculation lines, or recurring
pump failures?
[ ] What is the primary water pipe material (copper, galvanized
steel, etc.)? What is the condition of the piping system?
[ ] How is guestroom domestic water isolation valving arranged? Can
individual guestrooms be isolated, pairs or groups of rooms,
floor by floor, building by building, etc.?
[ ] Describe the guestroom plumbing fixtures by building,
construction phase, etc. as appropriate. Identify the type and
color of each major fixture including tubs (steel, cast iron,
fiberglass, Americast, etc.); toilets (bottom outlet, back
outlet, wall hung, gravity tank type, pressure bladder type,
Xxxxx flush valve type, water conservation, or standard volume,
etc.); lavs (steel, cast iron, china, fiberglass, stainless
steel, Vermax or other simulated marble, self rimming, drop in,
one piece molded vanity, etc.); shower enclosures (fiberglass,
tile, etc.). Identify the type of faucets and shower valves
used by building or construction phase by brand and general
description (i.e. Xxxx single handle non pressure compensated
shower valves, Symonns pressure balanced single handle shower
valves, Delta individual hot and cold lavatory faucets, etc.).
HVAC
----
[ ] Describe the HVAC system serving each major building area.
Identify what areas are served by common air handlers, and what
type of individual zone control is used for multizoned equipment
(VAV, terminal reheat, double duct, constant volume multizone,
etc.). Identify the energy source for heating for each system
(natural gas, electric resistance, electric heat pump, steam,
etc.).
[ ] For guestrooms, describe the heating and cooling system,
including the location of the individual room temperature
control, and the degree of control afforded the guest.
Describe the exhaust/ventilation for the guestroom. Is there an
individual exhaust fan in each bathroom, or a single central
ducted system? How are individual fans controlled, if
applicable (switched with bathroom light, on timer, on separate
switch, etc.) How does makeup (ventilation) air get back into
the guestroom?
[ ] Describe the makeup air system for the kitchen. Is there any
heat recovery? Is there a swamp cooler, gas pack heater, etc.?
[ ] Describe any makeup air system or ventilation and/or space
temperature controls for the laundry.
[ ] Describe the exhaust systems serving the public restrooms.
[ ] Describe the HVAC and any humidity control systems serving any
indoor swimming pool or jacuzzi areas.
[ ] Describe any central plant equipment, including chillers,
boilers, cooling towers, etc.
[ ] Identify any recurring problem areas or non functional
equipment. Identify the refrigerants used throughout the
facility and any measures being taken to convert from CFC
refrigerants. Are there any ASHRAE 15 refrigerant ventilation
issues?
Roofing
-------
[ ] Describe by building the type, age, condition, projected life
and any deferred maintenance or known problems for each building
roof.
Window Systems
--------------
[ ] Describe by building or construction phase, the type of window
system used. Describe whether single or double pane, clear,
bronze, heat absorbing, low emissivity, internally filmed, etc.
Describe the type of framing, whether aluminum, wood, vinyl,
fixed glazing, slider, casement, double hung, etc. Describe the
finish, such as painted, mill finish, bronze anodized, etc.
Describe the condition of each glazing system including any
deferred maintenance or known problems.
Exterior Siding
---------------
[ ] Describe the exterior siding used on each building or
construction phase. Identify the condition, age, projected life
and any deferred maintenance or known problems for each area.
Site
----
[ ] Describe the condition of any site paving including striping of
parking areas. Identify any known drainage problems, or areas
which appear to be in need of crack repair, seal coating or
asphalt overlay.
[ ] Describe the condition of sidewalks, exterior stairways, and/or
concrete decks, balconies or patios. Identify any known
deterioration or spalling, and any recent repairs to same.
[ ] Describe the condition of each pool or spa on the property.
Identify any known problems or deferred maintenance issues.
Utilities
---------
[ ] Identify any clear candidates for energy or other utility
conservation measures regarding electrical, natural gas, water,
sewer or garbage usage.
FF&E
----
[ ] Identify any recurring maintenance issues regarding room
casegoods or other FF&E items such as ice machines, operable
sound walls, banquet furnishings, etc.
Completed By: ____________________________________________
Title: ____________________________________________
Date: ____________________________________________
